Why You Need A Budget For Financial Independence + My July 2018 Budget

Do you question if you need to start budgeting for financial independence? Are you looking for an example of a real life budget to inspire you to start your own? Good news! I’m going to be sharing the ‘why’ behind budgeting, plus my personal budget with you right here! Keep reading…

Budgeting For Financial Independence


Welcome to the second post in my Financial Independence series. If you’re new, I would strongly suggest you read the first post in the series, where I offer tips to help you get started. I also share my personal story, on my YouTube channel, about how my upbringing influenced my financial habits and relationship with money. One of the things I shared in that video is my regrets about not  starting a budget sooner.

Everyone Needs A Budget

When you think of a person on a budget, what comes to mind?

“She must be struggling financially…”

“He’s probably got a lot of debt…”

“I’ll bet they’re saving for some big purchase…”

All of the above are absolutely possible. But, what about everyone else who doesn’t fall into these categories? Would you say that a person who isn’t struggling, has no debt, and isn’t planning a big purchase doesn’t need a budget?

If you would, you wouldn’t be alone. A Gallup poll from 2013 showed that only 1 in 3 Americans actually kept a written budget. With all of the personal finance advice available these days, I pray that these numbers have improved over the past five years.

The reality is that everyone needs a budget. It does not matter your income, assets, marital status, education level, debt load, or lack thereof.

You need a budget.

Budgets Help You Plan And Control

Budgets serve a primary purpose: they allow you to tell your money where to go. A budget is simply a plan. When you create a budget, you take control of your financial present and future by planning your expenses and savings based on your income.

A budget allows you to be prepared for, well, anything. It’s not a matter of if something will happen. It’s a matter of when. This isn’t even about assuming the worst will happen.

Life happens.

Whether it’s a flat tire, costly home repairs, illness, or job loss, things will happen that require money.

Without a budget, you are putting yourself at risk of creating debt by using borrowed money for everyday expenses that should be covered by your income.

My Current Debt Payoff Plan

I’ve been budgeting consistently since early 2016 with the goal to pay off student loan debt.

Your steps towards financial independence depends on your life stage and circumstances. For me, paying off debt is the best place to focus my efforts at this stage in my life.

I am single, with no children, and I work a full-time job earning what I would consider a modest income. I do not own a home, my car is paid off, and I do not have any credit card balances. Currently, my only debt is a low-interest student loan.

Debt Facts and Plan

  • As of July 2018 my student loan outstanding balance is $28,854.86.
  • Currently paying $500 per month
  • Goal: pay off the entire loan in 3 years or less
  • New monthly payment = $850

In order to find an extra $350 every month in my budget, I will have to increase my income or decrease my expenses. I plan to do both over the course of my journey, but my first goal is to decrease my expenses.

I recently moved (June 2018) and have instantly decreased my rent by nearly $200. I also anticipate that my utilities will decrease as well, because I have moved to a smaller place.

Without further adieu, here is my July 2018 budget.

My July 2018 Budget

I have prayed about my decision to share my real numbers here on the blog and decided that I want to be as transparent possible. I considered only sharing my monthly expenses. However, I realized that a budget includes both income and expenses, and leaving out income doesn’t really show you how I am adjusting my lifestyle to meet my financial independence goals.

I currently use the EveryDollar app to budget my expenses. It allows me to create a zero-based budget, giving every dollar a job. It’s quick, easy, and has a free version. There are a few other budgeting tools that I am exploring and will share with you if/when I implement them.


  • $3100 – This is my net (take-home) pay. In addition to taxes, deductions include medical, dental, health savings account ($75 per month); and a 401(k) (10% of gross income)
  • $50 – This is a guesstimate of the rolled and loose change that I need to deposit
  • $28 – Refund for purchases I need to return. I am notorious for returning things because I tend to be an impulse shopper. Gotta stop that habit.

Tithe, Offering, & Donations

  • I have chosen not to share these numbers on the blog but felt it is important to include them as a budget category. Faith, trust and generosity through tithing and giving has become an important part of my life. I believe that God has blessed me for it and will continue to do so.

Monthly Expenses

  • Rent $845 – this is such a blessing! My previous rent was $1033. By moving, I instantly decreased my living expenses!
  • Power/Electric $50 – I am guessing at this number. Since I’ve only been in my place for about a month, I do not know what the bill will be. My previous bill was around $65-$70 per month.
  • Gas $40 – also guessing. Previous bill was around $40-$50 per month
  • Internet $62 – I need Internet because I work from home and also because it’s 2018. Who doesn’t have Internet? I’m totally kidding. If you live off the grid, more power to you! I did cut the (cable) cord about 4 or 5 years ago, though!
  • Cell Phone $65 – I’m with T-Mobile and want to see if I can find cheaper cell phone services.
  • Auto Insurance $170 – I’ve tried to get it lower. This is the best I can do.


  • Student Loan $500.56 – although I’m not budgeting in the extra $350 due to miscellaneous bills (see below), I hope to be able to add more to this month’s loan payment. We’ll see!


  • Groceries/Household/Personal Care $150– This feels kind of low for me because I tend to go over due to lack of planning. I’m going to try to use up what I have and meal plan.
  • Fuel $60 – I work from home, so I rarely drive. I fill up my tank every other week or so.
  • Car Maintenance $7 – Monthly car wash fee.


*These are expenses that I will cut if absolutely necessary. They are the extras and luxuries that keep me from having budget burnout. Sometimes I spend all of the money, other times I don’t. I rarely go over in these categories. 

  • Netflix $7.99 – no explanation needed
  • Miscellaneous shopping $50 – fun money to spend on whatever I want. Sometimes I’ll save up this money for a big purchase
  • Social/ Restaurants $50 – coffee shops, dinner with friends, movies, etc.

Miscellaneous Bills & Fees

*This category includes one-time bills and/or infrequent expenses. If you add these up, you can see that I have quite a bit left over every month after the other categories are covered. 

  • Medical Bill $200 – I actually had two medical bills, but was able to use my HSA to pay the other one
  • Dental Cleaning $171 – I use an out of network dentist (because he is awesome!) and have to pay out-of-pocket upfront. I expect to be reimbursed for a portion of this bill, and will add the reimbursement to my income when I receive it
  • Renter’s Insurance $ 137.35 annually
  • Final Payment to Old Apartment $95.43
  • Library Overdue Fee: $2 – I am notorious for forgetting to return library books on time

Blog Expenses

*Because I am faithful that my blog will eventually become a business, I believe that it is important to invest in it. This includes books, courses, conferences, etc. 

  • JKBMM $15 – I am part of a blogging membership group. The group is amazing and extremely helpful to me on my blogging journey. It is currently closed, but I’ll be happy to share more about it when it opens up again.


*My goal is to add a little to these funds from every paycheck. Because of the miscellaneous expenses, I won’t be contributing to these funds this month. For true emergencies, I will use my emergency fund if I don’t have enough in these accounts. 

  • Car Maintenance $0 (current balance: $150) – fund for things like tires, oil changes, etc.
  • Health & Wellness $0 (current balance: $100) – an extra savings account for medical and dental bills if HSA balance is not enough.
  • Gifts $0 (current balance: $75) – includes all gifts, birthdays and Christmas
  • Clothes $0 (current balance: $50) – a fund for clothes purchases throughout the year
  • Emergency Fund – Fully funded! I sold my home in 2016 and used the profits to fully fund my emergency fund with an amount that makes sense for me. I don’t plan to contribute any extra money to my emergency fund during the debt payoff stage of financial independence. It will be used for true emergencies and to keep me afloat for a while if I lose my income.

How Will You Budget For Financial Independence?

I hope my transparency in sharing my own budget will inspire you to create yours. Please keep in mind that budgeting is a very fluid process. You will not be perfect at it and it is highly likely that you’ll discover things that don’t work for you. Don’t be afraid to make changes as needed.

Budgeting isn’t about living a rigid life with no enjoyment. It is about developing the discipline to manage your money so that you can reach your financial independence goals.

How do you budget? Do you use pen and paper? Excel? A budgeting app? Let me know in the comments below. I look forward to continuing to share my financial independence journey with you.

Happy budgeting!


Budgeting for Financial Independence



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  • Terrie Gatto

    Malika, I love this. You are super detailed and organized. I am in awe. This came at the perfect time. This month we have been working on redoing our budget. The hardest part for me is figuring out how to cut corners in groceries with a family as big as ours. I’m clueless when it comes to coupons. Any suggestions?

    • Malika

      Hi Terrie! Thank you so much for your kind words. I totally hear you about the grocery budget. I think food is one of the biggest areas where we overspend. Now, I’m a household of one, so I cannot imagine what this is like for a large family. Also, I am not a couponer because I’m only shopping for myself; I try to keep my food inventory low to avoid waste and also because of limited space. I do believe that there are things that anyone can do, regardless of household size, that can help you save money. One things I’ve started doing is Inventory Meal Planning. I start with what I have and come up with meal ideas based on that. This has really helped me a lot over the past few weeks because I’m only buying food that I need based on the meal plan I created. I will be sharing about this in my next blog post, so look out for it! Thank you for commenting!

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